An analysis by media agency TargetCast tcm utilizing data from NetCosts shows the average cost per unit for a primetime spot on network television in Q4 dropped 11% to $105,821 (compared to costs a year ago). FOX still had the highest unit cost at $122,098, with ABC and CBS not far behind. NBC was in 4th place at $76,436.
Gary Carr, SVP/Executive Director of National Broadcast at TargetCast tcm, said that despite the robust scatter marketplace, unit costs still dropped. “In part, this decrease was due to lower ratings, but it was also the result of the high percentage of units sold in the upfront market when pricing was well below traditional market value in the middle of the economic decline a year ago. It is a positive sign that network prime time ratings among adults aged 25-54 (A-25-54) were down only 6.5%, compared to the double-digit declines in recent years—probably due to improvements in program development in the aftermath of the writer’s strike of 2008. Though the strike ended in the spring of that year, the effect of full development did not come to fruition until the 2009/10 season.”
NBC recently replaced Conan O’Brien as host of the Tonight Show, and re-instated Jay Leno, blaming affiliate complaints about the low lead-in that Leno was feeding into the local late newscasts, though NBC was hurt in Late Night ratings as well.
In Q4, NBC’s Tonight Show ratings from Monday-Friday among A25-54 for Conan O’Brien were down 35% vs. those for Jay Leno a year ago. This had the effect of lowering NBC’s unit cost in the Late Night daypart by 8% to $22,643. Only the strong scatter market prevented these costs from falling further.
In contrast to the broadcast networks, ad-supported cable showed continued growth in unit costs, though cable TV was also affected by audience fragmentation. Although the decline was not as great as broadcast primetime, cable unit costs were up 5% for the top 15 cable networks. However ratings for the same networks were down 2%. The average unit cost of the Top 15 A25-54 rated cable networks in primetime was up 5%. At the top was ESPN at $40,000, followed by USA and TBS at nearly $18,000.
The TargetCast tcm analysis, using syndicated research and tracking data from the NetCosts system, examined actual reported spending for primetime ads on ABC, CBS, NBC, FOX and all ad-supported cable networks to compute an average unit cost for each net.